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Agglomeration economies and firm’s export intensity: evidence from Portuguese manufacturing SMEs

Author

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  • Rosa Forte

    (Universidade do Porto and CEF.UP.)

  • Ana Medeiros

    (Universidade do Porto)

Abstract

Export performance is a highly debated topic in the literature, with no consensus on how to measure it or what factors determine it. Most studies divide these factors into internal and external determinants, with a focus on internal determinants. This study, however, focuses on external determinants, namely agglomeration economies such as localization and urbanization economies and export spillovers, and their impact on a firm’s export intensity. Based on a large sample of Portuguese manufacturing SMEs over the period 2010 to 2018 (191,920 firm/year observations), the estimation results through the two-stage least squares method with fixed effects strongly indicate the existence of a positive relationship between agglomeration economies, particularly localization economies and export spillovers, and export performance. These findings suggest that firms located in areas with a high concentration of other firms in the same industry and other exporting firms tend to have better export performance, which has important implications for policymakers.

Suggested Citation

  • Rosa Forte & Ana Medeiros, 2024. "Agglomeration economies and firm’s export intensity: evidence from Portuguese manufacturing SMEs," Empirica, Springer;Austrian Institute for Economic Research;Austrian Economic Association, vol. 51(3), pages 807-828, August.
    • Handle: RePEc:kap:empiri:v:51:y:2024:i:3:d:10.1007_s10663-024-09616-0
    DOI: 10.1007/s10663-024-09616-0
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